A (Stag?)flationary Tantrum: Assessing the Current Market Sell-off

Thursday 16 June 2022

Investment Talks

   

A (Stag?)flationary Tantrum: Assessing the Current Market Sell-off

June 2022 | We are entering a tough phase of the regime shift, as the risks over economic growth add to the already hot inflationary backdrop. This means that stagflation fears will continue to drive the market and risk assets are likely to remain very volatile, particularly the most indebted companies and those with still excessive valuations.

01 |  Central banks have now acknowledged the inflation problem and changed their tone. They seem ready to act to protect their credibility, at least temporarily. However, they will probably not go too far and markets have already moved to incorporate their hawkishness.

02 | The current repricing is taking most of the overvaluation out of the market, but current levels are vulnerable to any deterioration in corporate fundamentals. Our forecast of a possible earnings recession in the EU leads us to maintain a more careful stance on Europe and supports our preference for US vs. EU equity.

03 | The latest events are a reminder of the regime shift we are currently in, with rising stagflationary risks as we continue to see upward revisions on inflation and downward revisions on growth.

(Stag?)flationary Tantrum:Assessing Current Market Sell-off

Important Information

Unless otherwise stated, all information contained in this document is from Amundi Asset Management US (Amundi US) and is as of June 16, 2022. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the author and not necessarily Amundi US and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not a guarantee or indicative of future results. Amundi Asset Management US is the US business of the Amundi Asset Management group of companies.

Other news

Before investing, consider the product's investment objectives, risks, charges and expenses. Contact your financial professional or Amundi US for a prospectus or summary prospectus containing this information. Read it carefully. To obtain a free prospectus or summary prospectus and for information on any Pioneer fund, please download it from our   literature section.

Securities offered through Amundi Distributor US, Inc.
60 State Street, Boston, MA 02109
Underwriter of Pioneer mutual funds, Member   SIPC.   

Not FDIC insured | May lose value | No bank guarantee Amundi Asset Management US, Inc.  Form CRS         Amundi Distributor US, Inc.  Form CRS